Algeria needs an oil price of $71/B to “balance” its 2013 budget, according to Finance Minister Karim Judeh. Speaking to state press agency Algerie Presse Service (APS) on 21 September, Mr Judeh defined the “budget balance price” as that which covered “real expenditure” but not “capital investment.”

At $71/B, Algeria would post an overall budget deficit of AD1,138bn ($13.9bn) for 2013, down from AD2,283bn ($28.0bn) for 2012, with the fiscal gap to be financed from the reserve fund, the Fond de Regulation des Recettes (Revenue regulation fund, FRR). All revenue generated from oil prices above an official ‘reference oil price’ of $37/B – in force since 2006 – enters the FRR (MEES, 1 February). The unrealistically low reference oil price has made dipping into the reserve fund an annual occurrence. (CONTINUED - 355 WORDS)